New power losses allocation method based on the decomposition of the network matrix and the voltage regulation at network nodes

In the modern context of electricity market deregulation, the price of the kilowatt-hour must take both power injections and withdrawals of the multiple market participants into consideration, as well as their actual grid usage. The responsibility for causing transmission losses and voltage drops therefore needs to be fairly attributed. While grid power injections and withdrawals are unequivocally attributed, it remains to date impossible to naturally share responsibility for transmission losses. Relevant literature proposes a variety of methods. This paper proposes a new method for allocating transmission losses to market participants using the network. The overall grid losses are obtained from summing the difference between injected and withdrawn power for all nodes. A set of allocation factors derived from the electrical distance between concerned buses and their voltage levels is used to attribute active power loss to each bus, after the losses arising from the mutual influencing between buses has been calculated. This method focuses on busbar current injections and assumes there is a hypothetical power flow between nodes. For mutual influencing, one of the busbars is considered a generator and the other a load. A reference bus voltage is set and then the load side is penalized depending on how far its own voltage is lower than that reference value. Results from a sample network are compared to those of previous methods.